The discussions are set to gain momentum with Reserve Bank governor Bimal Jalan scheduled to meet Mankad in Delhi on Wednesday. Sources said the discussions will be centred on various issues concerning banking reforms and external sector.

The meeting will also discuss possibility of interest rate reduction. The industry for long had been demanding that the interest rates be reduced in tandem with the rate of inflation which has been hovering around two per cent for quite some time.

Mankad, during his meeting with the heads of financial institutions, also discussed arious measures which might be taken by the government for strengthening capital markets and mobilising funds for development of infrastructure sector.

Among other things, the issue of opening of insurance sector and deepening of the banking sector reforms also came up for discussion.

Mankad also discussed the possibility of implementing the recommendations of the Verma panel for reviving the weak public sector banks. The Verma panel, among other things, had recommended setting up of an Asset Reconstruction Company, which had found favour with various bank chiefs.

Mankad, in consultation with Jalan, was likely to decide on the steps which might be initiated for giving a momentum to the process of industrial recovery process.

The meeting, which took stock of the current economic situation, was, among others attended by Industrial Development Bank of India (IDBI) chairman G P Gupta, Industrial Finance Corporation of India (IFCI) chief P V Narasimham and heads of other institutions.

The discussions at the meeting will provide inputs to the series of steps being planned by the new government which shall assume office on Wednesday. In a bid to maintain the euphoria on the economic front and sustain buoyancy in stock markets, the new government is proposing to announce a host of decisions in the first 100 days.